Reid’s Furniture’s Owner has Something to Say

By Michael J. Knell

Scott Reid was born a furniture retailer. Even though he admits that as a child he thought he’d be a police officer, an accountant or a professional hockey player (he is a Canadian, after all), for the past four decades he’s been working in and now running the business started by his father — Reid’s Furniture in Thunder Bay, Ont.

His dad, Tom, first opened the doors in 1968. His first location — on Simpson Street in the downtown area of the biggest little city in Northern Ontario, one that’s closer to Winnipeg than it is to Toronto — was small and offered an entry-level product assortment. Then called Tom Reid’s Furniture, he expanded the store three times, once by punching a hole in the adjoining wall to make one space.

In 1978, a time when Thunder Bay was made up of two municipalities — Port Authur and For William — Tom made a big move, one that set the business on the path leading to where it is today.

“Tom’s big move was to build a new store in a swamp between the two cities,” says Scott. “This turned out to be a great move as the cities merged into Thunder Bay in 1970, so it was only a matter of time until this area was developed. Reid’s Furniture is now in a prime location in the intercity area of Thunder Bay.”

Initially, the building covered 6,000 square feet but additions to the upstairs and renovations to the basement have given Reid’s Furniture total selling space of 24,000 square feet.

During those early years in the then-new building, a teenaged Scott and his brother, Shawn, were already working in the business, mostly in the warehouse and on the delivery trucks.

“My mother Mary was the bookkeeper, so it was truly a family business,” says Scott.

Reid’s Furniture has been a member of Mega Group since before the amalgamation of V.I.P. Stores and Magasins Ameublements B.V. back in 1992. In fact, Tom served on the group’s board of directors for a number of years and was one of the original members of the Countrywide banner. Once they became Reid’s Countrywide, Tom retired and passed the baton to Scott and Shawn.

A few years later, Shawn and his wife, Sharon, moved to Barrie, Ont., and opened what would become a very successful La-Z-Boy Furniture Gallery store leaving Scott in charge of Reid’s. Shawn and Sharon sold that business after 17 years and are now enjoying an early retirement.

Building the Reid’s Furniture Brand
Scott took the store out of the Countrywide banner in 2012, when Mega decided to consolidate it with Multi-Meubles to create what is now BrandSource Canada (although Reid’s remains what is called a ‘BrandSource Authorized’ retailer). Doing so prompted him to re-examine the retailer’s market position.

Drawing on Shawn’s experience with his La-Z-Boy store, Scott took a closer look at the motion furniture specialist’s support programs for retailers. “While Thunder Bay isn’t big enough, in our opinion, to support a free-standing La-Z-Boy gallery, we felt they had a very strong program that we could implement into our full-line furniture store — the Comfort Studio Program,” Scott said, adding after signing on they went a little further.

“We adopted their look and feel into our marketing and focused our merchandising to find complementary brands that appealed to a similar customer,” he continued, noting Reid’s soon signed on with three Canadian manufacturers including casual dining powerhouse Canadel, solid wood bedroom specialist Durham and case goods producer Handstone. “These three great vendors complement our La-Z-Boy display and allow us a great selection in both bedroom and dining.”

Under Scott’s leadership, Reid’s Furniture has moved away from the entry level merchandise profile of its early days, even implementing the La-Z-Boy in-home design program and now has three certified designer on staff. The store also floors product in the ‘better’ and ‘best’ price points from a fairly broad range of furniture, mattress and major appliance manufacturers such as Palliser, Décor-Rest, Stressless, Hammary, Monogram, Magniflex and GE Profile, among others.

But this doesn’t mean Reid’s has abandoned those price points. In 2009, the company purchased what was once a dairy operation in the heart of Thunder Bay just two kilometres away from the store. The original thought was to use the space as a warehouse.

But, Scott remembers, “the building was significantly bigger than what we needed, so we decided to open ‘Reid’s Liquidation Centre’ at one end of the building.

“The idea was we would display our ‘scratch and dents’, ‘dogs’ and our returns in the space,” he continues, “and our office team would ‘yard sale’ the goods should a customer walk in the door. As the word spread, the store got busier, and they weren’t finding the time to do their office work, so we hired a sales person. That lead to an advertising budget and now that we have expenses, we needed more square feet for product if we had a chance to make a buck. As Reid’s Liquidation Centre continued to grow, the store got physically bigger and the warehouse got smaller. Eventually we had to buy a much bigger distribution centre to support the two stores.”

Adding Ashley to the Business
To round out the assortment in the liquidation centre, Reid’s began flooring what Scott describes as the “low end” of the Ashley Furniture line, “essentially executing what at the time was their Furnish 1, 2, 3 program wih our logo.” As the liquidation centre’s business grew, he decided to take it in a new direction.

“We talked to Ashley about their HomeStore concept for years, but didn’t want to commit to the sizable investment of a new build,” Scott says. “In 2017, they had come out with Homestore Select, which was meant for smaller markets and basically a HomeStore without the big investment in a building. As this was pretty much what we are already doing with our liquidation store, we decided to go down the path.”

He admits as the process went along, he decided he couldn’t build a “half-assed” store and expect the results he wanted. “This evolved into dropping the ‘Select’ and investing in a multi-million dollar renovation and expansion of the old dairy located in the heart of Thunder Bay,” he said, noting Reid’s opened its Ashley HomeStore in the fall of 2017.

True to his character, Scott has given much thought to his relationship with Ashley, which according to the U.S. business publication Furniture Today is the largest furniture manufacturer and retailer in the world. While he’s generally satisified with their partnership, he also sees where there’s room for improvement.

“I thought my life would be so much easier if I partnered with a goliath like Ashley. I figured that they would provide me with great products at great pricing, easy access to inventory, and a great merchandising plan, which they did!” he enthuses. “I also thought they would provide me with a great marketing plan and a world-class web site. This, they have not yet accomplished, and I would have thought that this would be the easy part. There are days when I feel I bought a McDonald’s franchise, but it didn’t come with the recipe to make a Big Mac. We are doing well with the store, however, it’s more work than it needs to be.”

A Proud Member of Mega Group
Scott Reid is a very proud member of Mega Group, the retailer-owned co-operative furniture, mattress and appliance buying group based in Saskatoon. As mentioned previously, Reid’s Furniture has been a member since before amalgamation.

“We have been a Mega member for as long as I can remember,” he says, adding at one time they were very active in the organization. His father, Tom, was a member of its board of directors for several years while Scott was active on committees and participated in Mega-led performance groups.

“In the past 10 years, I have been the invisible member,” Scott says, admitting with a young family at home and growing frustration with many of the decisions the group was making he became less involved. “Other than central billing, I was not working with their programs at all.”

But this going to change in the coming years because he doesn’t want to give up the best parts of membership and expresses a desire to make Mega more effective and relevant to the life of the independent furniture, mattress and appliance retailer.

“I really don’t like the term buying group,” he exclaims. “I believe successful buying is done much better at the local level than it is through a group. When I buy, I develop a great relationship with the rep and factory. I focus my volume so I become important to the supplier, creating a partnership that sees them help to take care of our mutual customers when a problem occurs.

“It also sees them supporting my marketing efforts as my sale becomes their sale,” he adds. “I find this so much better than jumping from supplier to supplier chasing the deal of the day.

“Focusing with a vendor also allows you to fill trucks. After all, LTL (less than truck load) shipping is very expensive and something we try to avoid,” he continues, adding, “Beating a supplier for a better price only to give it to the freight company is a lose/lose. Paying a fair price and optimizing freight is a better way to go, in my mind.”

This brings Scott to his primary criticism about Mega. “My frustration with the buying group stems from their buyers needing to justify their existence,” he says. “They tell me to buy from vendor ‘A’ and as soon as I get that nicely set up, they move to vendor ‘B’ for a better deal. The fact that vendor ‘B’ and I have no relationship, costs more in freight and has distribution with every other store in town, isn’t thought of.”

He believes buying groups should really be efficiency groups. “Their purpose should be to make life easier and more affordable for small to medium size retailers,” he says, noting big retailers have entire departments to deal with things such as accounting, payroll, human resources, delivery, and websites while most smaller businesses often have trouble justifying the expense or finding the right people to do the job.

“This is exactly why I have started to become more active with Mega,” he shares. “The value of their central billing is incredible and well known. The work they are now doing with their e-accounting, their Alta website, the digital marketing, e-mail marketing as well as sales training are all things I’m using or will use in the future. I believe they are on the right track.”

He also thinks another potential name for the group is networking group. “The greatest value I receive from Mega are the friendships made during the cocktail hour at the meetings,” he says. “There are members, retired members and former staff members that I converse with regularly. I have always enjoyed travelling across Canada knowing I have friends in most little towns I pass through. I love to visit those stores just to say ‘hello’.”

At the Crossroads
“The furniture business has been wonderful to me,” Scott Reid says empatically. “I have made great friends all over North America. I have travelled the world and have fond memories of many experiences. I have no regrets!”

As his greatest accomplishment, he cites building a team of talented people who are not only very good at what they do, but have grown Reid’s Furniture expontentially from where it started.

“As the second generation in this family business, I find myself at a crossroad where I don’t know if I should start thinking about my own retirement or if I should focus on the future growth of the company,” he confesses, noting his two teenage sons — who he describes as “all-round great kids” — are both two young to committ to carrying on the business.

“So, while they are growing up and going to school, I have a responsibility to continue to grow Reid’s and provide them with the same opportunity my father provided to me,” he continues. “With that said, I have been focusing on removing the hats I wear so that I am not needed to work ‘in the business’ – allowing me to ‘work on the business’ around my personal schedule.”

The Challenges Ahead
As 2022 comes to a close, Scott Reid faces two challenges he believes are common to almost all independent furniture, mattress and appliance retailers. Both are related to the COVID-19 pandemic. First, for the first time in quite a while Reid’s Furniture is over-inventoried. Secondly, the store can’t find enough good people to join its team.

“COVID was very scary for us all when it first reared its ugly head because of the fear of the unknown. Once it took affect and people were told to stay home, COVID turned into something positive for the furniture business. It definitely had its share of headaches but business boomed,” he says.

Like many other retailers, business was so brisk the supply chain become challenged, which in turn meant the product acquisition process had to change to make sure the cart was full.

“I have always loved ‘just-in-time’ inventory so the pandemic forced me to ask ‘which is the better of the two evils?’ — to have no inventory, where expenses will be low, cash will be liquid, sales will drop, and salespeople will starve and potentially leave,” he says. “The second evil is to have too much inventory, where you lose all efficiencies, you have to rent additional warehouses, and you have all of your cash tied up in product. Like most, took the second evil. Now we have another difficult choice to make. Do we bring our inventory back down to the pre-COVID ‘normal’ or do we beef up our infrastructure to continue the momentum and maintain the sales that will allow us to carry the extra inventory, essentially creating a ‘new normal’?

“Once again, we are choosing the later. This makes me ask ‘are our sales up because of COVID or are they up because we now stock the inventory to provide customers with instant gratification?”

The dilemna has caused Scott to look for talented people to grow his team, but is struggling to find them. “It appears the entire world is looking for people. I have never had too much trouble finding good people, however, in the past year I have found I’m having similar struggles to what my colleagues have been experiencing for years. When others industries can’t find people, they come head-hunting yours. With that said, our people are gold and we need to focus on keeping them!”

He believes the industry needs to be better at telling people that being a sales professional is a great career. “It is a trade that when done right can be very lucrative,” he says, “We wear nice clothes, work in a warm environment, and work with happy people every day when we do things right! Like every trade, people become more skilled with practice. It is our job to recruit, coach and cheerlead.”

Thinking About the Future
“What is the secret to success in the furniture business in the 21st century?” Scott Reid asks. “As much as things have changed and how quickly things now change, I think the business is very much the same and believe ‘relationships’ remain a big part of the secret.

“If you have great relationships with your staff, they are happy and they stay! They in turn have great relationships with your customers, so they are happy and return. The volume this creates is important to the suppliers, so they in turn are happy and the relationship allows us to profitably sell quality products while looking after our customers, which ultimately circles back to why the employees stay and prosper and the customers continue to return and refer us to their friends,” he answers.

He concedes it’s easy for the consumer to buy with the click of a mouse. “Thankfully shipping bulky furniture one piece at a time is not a smart way to do things. It’s expensive and riddled with headaches.

“While the internet will take its piece of the pie,” he continues, “If we continue to focus on quality products the consumer can touch and try, offer advice from a knowledgeable staff and deliver damage free, there’s more than enough market left for us to thrive.”

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